Today the Fair Work Commission announced cuts to Sunday and Public Holiday wage rates. We see this a positive development for retailers given Sunday is increasing in importance as a trading day. Our analysis shows a theoretical boost to FY18 EBIT of 4-12% for retailers under our coverage.
Sunday is big: We show Google Trends data thathighlights that Sunday is now one of the biggest trading days of the week for retailers under our coverage. Recent comments by Woolworths CEO Brad Banducciat FY16 results ‘Sunday’s really jostles in our business now as the biggest trading day of the week with Saturdays, it’s amazing,’ illustrate its growing importance as trading day. As limitations on Sunday trading are gradually removed and consumers become more time poor, we think it logical that consumers shop more on Sundays. WOW has often made the point that in the past labour was cut back on Sundays – which no doubt immediately improved profitability, but led to a weaker customer experience. Part of the recent strategic changes made by the company was to increase labour hours on Sundays.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
